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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Richard D who wrote (42005)	4/10/1999 11:09:00 AM
From: William JH	Respond to of 95453

From the Simmons report: "I sadly give the industry, on the whole, poor marks for understanding its own economic dynamics......The industry is badly in need of re-engineering to remove these debilitating boom and bust cycles." I came to the conclusion a while back that the way energy E & P companies do business benefits corporate insiders and Wall Street deal makers, but long term investors are not going to well, generally speaking. (I mentioned this previously on the E & P thread). What I see over and over in the independents is a huge amount of borrowing for exploration, followed by glowing reports about expanded reserves and production, followed by impairments and write downs when the inevitable downturns come. As is seen in several instances today, investors are left with stock in a debt ridden, near bankrupt concern, or at best a company whose stock price is at a very low level. This seems somewhat incredible to me, in view of the fact that there is such a huge and growing market for energy. There has to be a better way to this industry to operate, I'm just not smart enough to know what it is.